Small businesses vital

Owning a small business is almost in the blood of Caymanians. Nearly every Caymanian either owns or has owned a small businesses or has some family member that does or has. It’s the common dream of many Caymanians, who see owning a small business not only as an independent way of earning a living, but also as a way of making their mark on society.

Although there is no official definition of what constitutes a small business in the Cayman Islands, even by the most conservative of criteria, the vast majority of businesses here are small. These small businesses in Cayman create the majority of commerce, employ the most people and have by far the biggest impact on the economy.

This is why the Observer on Sunday has decided to dedicate space in its four issues during the month of September to articles about small businesses in Cayman and the many challenges they face.

Because of the financial crisis, many small businesses are in a fight for survival now. The combination of reduced commerce and increased fees has significantly affected the profitability of Cayman’s small businesses. Some have already closed their doors for good while others have had to alter their business model in attempt to get by until better times return. Businesses owners are working out of their homes or are using technology in an effort to cut overheads and increase profitability.

With no real manufacturing base, many of Cayman’s small businesses provide services of some sort rather than products. Although this helps keep start-up costs down, it tends to make Cayman’s small businesses even more reliant on labour.

The challenges presented by the rollover policy, the increase in work permit fees and the higher number of out-of-work Caymanians have made it more difficult for small businesses to recruit, hire and retain the employees they need to be successful. As a result, more and more businesses are resorting to out-sourcing certain company functions, sometimes off island. This has helped cause the first real reduction in population in the Cayman Islands in more than a half-century, putting further pressure on small businesses.

The articles this month will delve into the changing dynamics of owning a small businesses and what various organisations are doing to help ensure the survival of what is truly the lifeblood of the Cayman economy.